Innovation is the key for the payments sector
The payments industry is transforming very fast. The world goes online. Electronic money and cryptocurrency appear. E-commerce is growing, new players are offering alternative payment instruments. But still, the banking system remains the key link in the payment system. Also, it is important to combine innovation and security of payment solutions. Dynamic changes in the payment sphere are quite logical. As for 2020, there are some specific payment trends for this period. There are two key themes: instant payments and open innovation. To the payments industry, innovation and open business are of the greatest importance. There are the main payment trends 2020.
Instant payments are the main trend of the payment innovations in the industry for 2020. Electronic payments are a great alternative for cash. This fight of two systems is at its pick nowadays. As for the perspectives. Looks like electronic money soon would appear in the place of usual cash.
The role of AI
The first phase of the digital revolution at the turn of the millennium focused on building digital infrastructure, as well as digitizing products and services. The following years were associated with the conceptualization, design, and creation of digital distribution channels, the construction of sustainable digital business models. Currently, the development of artificial intelligence is moving towards digital transformation and contributes to its development. In recent years, with ever more powerful processors, larger amounts of data, and increasingly sophisticated algorithms, machines have begun to learn. These processes marked the beginning of an unstoppable phase of development that could well become a turning point for a large number of sectors and industries. As for the payment, it’s one of 2020 payment innovation because it can lead to significant increases in productivity and a reduction in the cost of business.
Advancing payment technology
One more trend of the innovations in payment technologies in 2020 is instant and invisible payments. Due to the constant development of technologies, it corresponds to all the security standards. In e-commerce transactions in 2020 payments innovation would be more widespread biometric features, such as fingerprints, face scans, and voice recognition. Such payment transactions are characterized by a high level of security.
This is one more trend in 2020. New technologies make it possible to earn more with intensive use of information. Proponents of the omnichannel can get the most out of their data business. Omni-channel exists for several years. It is logical product of the evolution of electronic retail. The main message of this approach comes down to placing the client at the forefront and building the infrastructure of interaction with him. This is very similar to how we build relationships with other people in life.
For financial institutions, there is constant growth in compliance requirements. The most expectable trends in this area are the use of AI for more advanced analytics, fraud and AML convergence, RPA, and automation of trade finance compliance operations.
Those banks, which focuse on PSD2 delivery compliance to premium APIs will transition from APIs to enable commercial opportunities. For banks, this is an opportunity to offer lending or savings products. They can set up recurring funding/consumption of their products.
There is a huge impact of new technologies on the payment market. For example. Nowadays id widespread Open banking, which is strongly connected with different payment innovations. The success of new payment means is necessary for user adoption. That’s why payment companies have to be agile and adopt an innovative mindset.